-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JTtfYuF83PUtfYjLCFEVGEYL1AiMhiesSMrtEIoGNf/8XMDwOBVZm0M9C3aHv8gt 1zBJBuEHx7/cs/9pAXvQXA== 0000740664-97-000004.txt : 19970610 0000740664-97-000004.hdr.sgml : 19970610 ACCESSION NUMBER: 0000740664-97-000004 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970430 FILED AS OF DATE: 19970606 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: R F INDUSTRIES LTD CENTRAL INDEX KEY: 0000740664 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC CONNECTORS [3678] IRS NUMBER: 880168936 STATE OF INCORPORATION: NV FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-13301 FILM NUMBER: 97620101 BUSINESS ADDRESS: STREET 1: 7610 MIRAMAR RD STREET 2: BLDG 4100 CITY: SAN DIEGO STATE: CA ZIP: 92126 BUSINESS PHONE: 6195496340 MAIL ADDRESS: STREET 2: 7620 MIRAMAR RD #4100 CITY: SAN DIEGO STATE: CA ZIP: 92126-4202 FORMER COMPANY: FORMER CONFORMED NAME: CELLTRONICS INC DATE OF NAME CHANGE: 19910204 10QSB 1 2ND QUARTER REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FOR 10-QSB Quarterly Report Under Section 13 or 15 (d) of Securities Exchange Act of 1934 for Quarter ended April 30, 1997 Commission File Number 0-13301 RF INDUSTRIES, LTD. (Exact name of registrant as specified in its charter) Nevada 88-0168936 (State of Incorporation) (I.R.S. Employer Identification No.) 7610 Miramar Road., Bldg. 6000, San Diego, California 92126-4202 (Address of principal executive offices) (Zip Code) (619) 549-6340 FAX (619) 549-6345 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: None. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days Yes X No Indicate the number of shares outstanding of each of the issuer's classes of common stock at the latest practicable date. As of April 30, 1997, the registrant had 3,048,763 shares of Common Stock, $.01 par value, issued and outstanding. Part I. FINANCIAL INFORMATION Item 1: Financial Statements BALANCE SHEET April 30 October 31 1997 1996 ----------- ----------- (Unaudited) (Audited) ASSETS - ----------------- CURRENT ASSETS Cash ................................................ $ 835,095 $ 403,547 Investments in available-for-sale securities ........ 623,047 604,186 Trade accounts receivable less allowance for doubtful accounts of $12,412 .................... 760,721 703,097 Inventories - Note 3 ................................ 1,959,218 1,861,856 Prepaid expenses and deposits ....................... 512,727 276,109 Deferred tax assets ................................. 60,000 60,000 ---------- ---------- TOTAL CURRENT ASSETS ........................... 4,750,808 3,908,795 FIXED ASSETS Furniture and office equipment ...................... 107,633 107,633 Equipment and tooling ............................... 405,850 381,891 ---------- ---------- Fixed assets, at cost .......................... 513,483 489,524 Less accumulated depreciation and amortization ...... 396,857 377,715 ---------- ---------- NET FIXED ASSETS ............................... 116,626 111,809 Deferred tax assets ................................. 38,000 38,000 Other assets ........................................ 4,901 4,900 ---------- ---------- TOTAL ASSETS................................... $ 4,910,335 $ 4,063,504 ========== ========== See Notes to Financial Statements Item 1: Financial Statements (continued) BALANCE SHEET April 30 October 31 1997 1996 ---------- ---------- LIABILITIES AND STOCKHOLERS' EQUITY - ----------------------- CURRENT LIABILITIES Accounts payable ................................. $ 364,973 $ 186,250 Accrued expenses ................................. 163,452 268,015 ----------- ----------- TOTAL CURRENT LIABILITIES ................... 528,425 454,265 STOCKHOLDERS' EQUITY Common Stock - $.01 par value Authorized - 10,000,000 shares Issued & outstanding 3,048,763 shares............ 30,488 27,782 Capital paid in excess of par value .............. 4,801,941 3,868,642 Retained earnings ................................ 510,970 166,547 Unearned compensation ............................ (960,709) (453,732) ----------- ----------- TOTAL STOCKHOLDERS' EQUITY .................. 4,381,910 3,609,239 ----------- ----------- TOTAL LIABILITIES & STOCKHOLDERS' EQUITY ..................... $ 4,910,335 $ 4,063,504 =========== =========== See Notes to Financial Statements Item 1: Financial Statements (continued) STATEMENTS OF OPERATIONS (Unaudited) (Unaudited) Three Months Ended Six Months Ended April 30 April 30 -------------------- --------------------- 1997 1996 1997 1996 ------ ------ ------ ------ Net Sales ................... $1,750,831 $1,269,624 $3,678,928 $2,179,589 Cost of Sales ............... 1,050,880 510,839 2,121,312 961,804 ---------- ---------- ---------- ---------- Gross Profit ........... 699,951 758,785 1,557,616 1,217,785 ---------- ---------- ---------- ---------- Operating expenses: Engineering ............ 109,767 130,582 221,595 235,239 Selling and general .... 458,039 362,025 795,081 642,333 ---------- ---------- ---------- ---------- Total ................ 567,806 492,607 1,016,676 877,572 ---------- ---------- ---------- ---------- Operating income ....... 132,145 266,178 540,940 340,213 Interest income ............. 16,026 10,898 30,700 24,909 ---------- ---------- ---------- ---------- Income before provision for income tax .............. 148,171 277,076 571,640 365,122 Provision for state & federal income tax .................. 45,000 100,000 228,000 120,000 ---------- ---------- ---------- ---------- Net income ............. $ 103,171 $ 177,076 $ 343,640 $ 245,122 ========== ========== ========== ========== Per share data: Net income ............. $ 0.03 $ 0.06 $ 0.11 $ 0.08 ========== ========== ========== ========== Weighted average common and common equivalent shares outstanding ................. 3,163,291 2,988,235 3,125,872 2,921,202 ========== ========== ========== ========== See Notes to Financial Statements STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended April 30 --------------------- 1997 1996 ------ ------ Net income...............................................$ 343,640 $ 245,122 Adjustments to reconcile net income to net cash (used in) provided by operations Depreciation and amortization ....................... 19,142 22,223 Amortization of unearned compensation ............... 109,677 19,165 Change in assets - (incr) decr: Accounts receivable - trade ..................... (57,624) (163,480) Inventories ..................................... (97,362) (146,788) Other assets .................................... 236,618) 5,525 Change in liabilities - incr (decr): Accounts payable ................................ 178,723 (64,116) Accrued expenses ................................ 125,440 238,684 --------- --------- Net cash (used in) provided by operating activities ........................ 385,018 156,335 --------- --------- INVESTING ACTIVITIES Purchase of available-for-sale securities ....... (18,861) (12,983) Capital expenditures ............................ (23,959) (21,347) --------- --------- Net cash provided by (used in) operating activities .......................... (42,820) (34,330) --------- --------- FINANCING ACTIVITIES Proceeds from sale of common stock .............. 20,000 20,000 Proceeds from exercise of common stock options .. 69,350 0 --------- --------- Net cash provided by financing activities ....... 89,350 20,000 --------- --------- Net (decrease) increase in cash and cash equivalents ............................. 431,548 142,005 Cash and cash equivalents at the beginning of the period .......................... 403,547 211,290 --------- --------- Cash and cash equivalents at the end of period .....$ 835,095 $ 353,295 ========== ========== NOTES TO FINANCIAL STATEMENTS Note 1 - Management's opinion In the opinion of management, the accompanying financial statements contain all adjustments necessary to present the financial position of RF Industries, Ltd. as of April 30, 1996 and the results of operations for the three month and six month periods ended April 30, 1996 and 1995. Note 2 - Interim reporting The results of operation for the three month and six month periods ended April 30, 1996 and 1995 are not necessarily indicative of the results to be expected for the remainder of the year. Note 3 - Components of Inventory April 30, 1997 ----------------- (Unaudited) Raw material and supplies........... $ 234,795 Finished goods...................... 1,724,423 ------------ TOTAL........................... $ 1,959,218 ============ Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS SIX MONTHS 1997 VS. SIX MONTHS 1996 Net sales increased 69%, or $1,499,339, to $3,678,928 from $2,179,589 in the first six months of fiscal 1996. RF Connectors sales increased 48% to $2,519,314, from the same period last year. The increase is attributable to expanded distribution and the introduction of the corrugated cable and din connector products. RF Neulink sales were $1,159,614, up 146% from the same period last year. Cost of sales increased 121%, or $1,159,508, to $2,121,312 from $961,804 last year and as a percentage of sales increased to 58% from 43% last year. The increase in cost of sales is due to a changed product mix and shipment of lower margin Neulink products in the first half of fiscal 1997. Engineering expenses decreased 6.1%, or $13,644, to $221,595 from $235,239 last year and declined, as a percent of sales, to 6% from 11% of sales last year due to the increase in net sales. Selling and general expenses increased 24%, or $152,748, to $795,081 from $642,333, and declined, as a percent of sales, to 22% from 29% last year. Higher selling and administrative expenses to support training of personnel at the company's large new distributors was offset by the increase in net sales. Interest income increased $5,791 to $30,700 from $24,909 due to the company's higher average cash balances and an increase in the rate of interest received. The provision for income taxes increased $108,000. Last year, the company was able to utilize tax loss carryforwards to reduce its effective tax rate. THREE MONTHS 1997 VS. THREE MONTHS 1996 Sales increased 38%, or $481,207, to $1,750,831 from $1,269,624 in the second quarter of fiscal 1996. The sales increase was due to a 33% increase in RF Connectors sales to $1,317,384. The increase in Connectors sales is due to the company's additional distributors. Neulink's sales were affected by delays as reviewed in the six month results. Cost of sales increased 106%, or $540,041, to $1,050,880 from $510,839 and as a percentage of sales increased to 60% from 40% last year. The reasons for the increase are discussed in the six month results. Engineering expenses decreased 16%, or $20,815, to $109,767 from $130,582 last year and declined, as a percent of sales, to 6% from 10% of sales last year due to the increase in net sales. Selling and general expenses increased 27%, or $96,014, to $458,039 from $362,025, and declined, as a percent of sales, to 26% from 29% last year. Increased selling and administrative expenses to support training of personnel at the company's large new distributors was offset by higher net sales. Interest income increased $5,128 to $16,026 due to the company's higher average cash balances and an increase in the rate of interest received. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) MATERIAL CHANGES IN FINANCIAL CONDITION: Cash increased $431,548 to $835,095 compared to the October 31, 1996 fiscal year balance of $353,295. Cash and cash equivalents are $1,458,142 at April 30, 1997. Trade accounts receivable increased $57,624, or 8% to $760,721 compared to the October 31, 1996 balance of $703,097. This is due to the company's increased sales . Inventories increased $97,362 compared to the October 31, 1996 inventory level as a result of purchases to meet higher customer demand. Prepaid expenses and deposits increased $236,618 from October 31, 1996 due to more deposits for inventory purchases. PART II. OTHER INFORMATION Items 1-4: Not applicable Item 5: Information required in lieu of Form 8-K None. Item 6: Exhibits and Reports on 8-K (a) None required (b) Reports on Form 8-K No reports on Form 8-K were filed during fiscal quarter ended April 30, 1997. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. RF INDUSTRIES, LTD. Dated: June 5, 1997 By: /s/ Howard F. Hill ---------------------------------------- Howard F. Hill, President Dated: June 5, 1997 By: /s/ Terrie A. Gross ---------------------------------------- Terrie A. Gross, Cheif Financial Officer EX-27 2 ART. 5 FDS FOR 2ND QUARTER 10-QSB
5 6-MOS OCT-31-1996 NOV-01-1997 APR-30-1997 835,095 623,047 773,133 12,412 1,959,218 4,750,808 513,483 396,857 4,910,335 528,425 0 0 0 30,488 4,351,422 4,910,335 3,678,928 3,678,928 2,121,312 3,137,988 0 0 (30,700) 571,640 228,000 343,640 0 0 0 343,640 .11 .11
-----END PRIVACY-ENHANCED MESSAGE-----